American Airlines Earnings before Tax vs Enterprise Value Analysis

Earnings before Tax vs Enterprise Value

Earnings before Tax

Earnings Before Tax is calculated by adding Income Tax Expense back to Net Income.

Enterprise Value

Enterprise Value (or EV) is usually referred to as American Airlines theoretical takeover price. In the event of an acquisition, an acquirer would have to take on American Airlines Group debt, but would also pocket its cash. Enterprise Value is more accurate representation of American Airlines value then its market capitalization because it takes into account all of American Airlines Group Inc existing debt. Enterprise value is a measure of the value of a business as a whole, calculated as Market Capitalization plus Total Debt USD minus Cash and Equivalents USD.

Accounts Relationship

Earnings before Tax vs Enterprise Value

Significance: Almost Identical Trend

Overlapping area represents amount of trend that can be explained by analyzing historical patterns of American Airlines Group Earnings before Tax account and Enterprise Value

Correlation Coefficient

0.91
Relationship DirectionPositive 
Relationship StrengthVery Strong